Highlights. The United States is home to an estimated 1,150 malls; some sources project that by 2032, there may be as few as 150 malls still in operation.
- Projections indicate that up to 87% of large shopping malls may close over 10 years.
- Closed malls are empty for an average of 3 years and 11 months.
- The number of malls declined 16.7% per year from 2017 to 2022.
- 2 million square feet of mall space was demolished in 2022.
- The nationwide mall vacancy rate is 110% higher than the overall average retail vacancy rate.
Mall Closures & Vacancy Statistics
Shopping malls are more than twice as likely to be vacant as the average retail space.
- By some estimates, there were as few as 700 large shopping malls left in the U.S. in 2022.
- Malls had an 8.6% vacancy rate at the end of 2023.
- In 2023, there was a negative net retail mall absorption* of 406 thousand square feet.
- Class C malls with less than $300 in annual sales per square foot have a vacancy rate of 10.2%, 18.6% higher than the overall vacancy rate for shopping malls.
- Class B malls ($300 to $500 annual sales per sq ft) have a 6.8% vacancy rate; Class A malls ($500 or more in annual sales per sq ft) have a 3.6% vacancy rate.
- An average of 1,170 shopping malls closed every year between 2017 and 2022.
- The average vacant mall sells at 43% below its acquisition price.
- Shopping malls had a high-end average vacancy rate of 11.4% in 2021.
- From 1986 to 2017, shopping malls closed at a rate of 581 per year.
- U.S. malls, large and small, numbered 25,000 in 1986.
*Net absorption is the net utilized retail space versus unused space.
Mall Repurposing Statistics
Empty malls are often repurposed; such subsequent uses include sports centers, flex spaces, restaurants, and self-storage.
- 31% of vacant malls subsequently acquired new tenants through pop-up.
- 16% of empty malls reopened as mixed-use centers.
- 8% of vacant malls became warehouses, 7% became residential housing, 5% became delivery or distribution centers.
- 4% of vacant malls became community college or university spaces; a further 4% became health care, hospital, or medical facilities.
- 25% of vacant malls reopen for other purposes.
- 20% of vacant malls are rezoned.
- Banks finance 41% of repurposed malls.
- 18% of repurposed vacant malls are financed by retail real estate investment trusts.
- 17% of repurposed malls are financed by private investors.
- 5% of repurposed malls are funded by governments (local, state, or federal), 2% are financed by credit unions, and 15% have other sources of financing.
These data and insights were compiled by the Capital One Shopping team based on publicly available data.
Sources
- National Association of Realtors, Case Studies on Repurposing Vacant Retail Malls
- Jones Lang LaSalle IP, Inc., United States Retail Outlook
- Federal Reserve Bank of Richmond, Econ Focus: The Economic History of the Shopping Mall
- Business Insider
- The Motley Fool, What Is a Class A Mall?